and P Raghavendra (raghavendra868@gmail.com) is a research scholar in the department of sociology, University of Hyderabad.

The experiment in restructuring the healthcare sector through the Aarogyasri community health insurance
scheme in Andhra Pradesh has received wide attention across the country, prompting several states
governments to replicate this “innovative” model, especially because it supposedly generates rich electoral
dividends . However, after a critical scrutiny of this neo-liberal model of healthcare delivery, this paper
concludes that the scheme is only the construction of a new system that supplants the severely underfunded
state healthcare system. It is also a classic example of promoting the interests of the corporate health
industry through tertiary hospitals in the public and private sectors.

Medical neo-liberalism is characterised by the commodification of health that transforms individuals
from patients to consumers. Unlike patients, consumers who seek healthcare bear the responsibility for the
choices they make or fail to make regarding their health. As consumers are positioned to make choices about healthcare,
they also have the obligation to utilise products and services that are available to ensure good health or to treat illness and
disease. Fisher (2007) points out that patients as consumers have embraced the neo-liberal logic of healthcare so that they
too see illness in reductionist terms and seek pharmaceuticals as targeted magic bullets. With growth in customised products
and medical costs, access and affordability to healthcare has become a key issue across the world.
In the Indian context, the increased disease burden on the poor along with rapidly growing healthcare costs has been the
subject of debate for sometime now. Services in government healthcare institutions have declined over the past two decades
at the primary and secondary level, leaving the sick-poor with no option but seek private healthcare services. Several
studies have pointed out that rising expenditure on health and education is one of the main contributory factors to high
indebtedness and subsequent suicides among peasants in different parts of the country in the last 10 years (Sarma 2004;
Ghosh 2006).
Clearly, healthcare has assumed huge political signifi cance for the neo-liberal state with new and innovative (populist)
healthcare programmes being launched in several states in different forms. Among these, Rajiv Aarogyasri, a community
health insurance scheme introduced by the Government of Andhra Pradesh (AP) on a pilot basis in 2007 and implemented
in 2008 is being hailed by many experts as a model to be emulated – the scheme covers 6.55 crore people belonging to
183 lakh below the poverty line (BPL) families.Aarogyasri needs special attention as it is supposed to have mobilised a large number of voters for the ruling Congress Party during the 2009 assembly elections who helped it return
to power for a second term. This scheme’s popularity is so huge that several delegations from different states in India have
been regularly studying its logic in order to replicate it and reap similar political benefi ts. States such as Kerala, Tamil
Nadu (Kalaignar Scheme), Delhi (Apka Swasthya Bima Yojana), and Karnataka have already formulated a similar template
and are in the process of implementing it. The Maharashtra government too announced the Rajiv Gandhi Jeevandayee Arogya Yojana, a free medical care scheme for the poor in 2011, committing Rs 800 crore in the fi rst phase to benefi tnearly 50 lakh families earning below Rs 1 lakh per annum ineight districts.

A national social health insurance scheme called the Rashtriya Swashthya Bima Yojana (RSBY) waslaunched as a centrally-sponsored scheme in 2008 to cover 2.3 crore families and seven crore benefi ciaries. The AP government has already announced that Aarogyasri will soon become a universal health scheme and cover non-BPL families as well.

Given the pre-eminence of the scheme, it is important to assess the scheme by locating it in the historical evolution of healthcare systems in India in the context of its underlying socioeconomic and political dynamics.